He continued, "Loan portfolio growth was solid in the third quarter with loans increasing 1.57%, and deposits increased 6.70%. To supplement its already well-capitalized financial position, the Company issued
Commenting on credit quality,
Third Quarter 2020 Highlights
- Net income of
$5.2 million increased 92.6% from$2.7 million in the preceding quarter - Diluted earnings per common share of
$0.67 increased 91.43% compared to$0.35 in the preceding quarter, and 19.64% compared to$0.56 in the third quarter of 2019 - Net interest margin, on a fully taxable equivalent ("FTE") basis, was 2.80%, compared to 2.98% in the preceding quarter
- Noninterest income increased
$1.3 million to$9.1 million in the third quarter of 2020, compared to$7.8 million in the preceding quarter - Provision for loan loss decreased to
$4.3 million of provision expense in the third quarter of 2020, compared to$5.6 million provision expense in the preceding quarter - Total assets decreased 3.75% to
$2.45 billion atSeptember 30, 2020 , compared to$2.54 billion atJune 30, 2020 - Total loans increased 1.57% to
$1.84 billion atSeptember 30, 2020 , compared to$1.82 billion atJune 30, 2020 - Total deposits increased 6.70% to
$1.94 billion atSeptember 30, 2020 , compared to$1.82 billion atJune 30, 2020 - Book value per common share increased 3.22% to
$24.06 per common share atSeptember 30, 2020 , compared to$23.31 per common share atJune 30, 2020 - Tangible book value per common share increased 3.59% to
$18.74 per common share atSeptember 30, 2020 , compared to$18.09 per common share atJune 30, 2020
Net Interest Income and Net Interest Margin
Level One's net interest income increased
Level One’s net interest margin, on a FTE basis, was 2.80% in the third quarter of 2020, compared to 2.98% in the preceding quarter and 3.59% in the third quarter of 2019. This decrease in the net interest margin compared to the preceding quarter and third quarter of 2019 was primarily a result of lower yields across most interest-earning assets, mostly reflecting the impact of lower interest rates. Average loan yield decreased 36 basis points to 3.98% for the third quarter of 2020, compared to 4.34% for the preceding quarter, and decreased 143 basis points from 5.41% for the third quarter of 2019, primarily due to the target federal funds rate dropping 150 basis points in
Noninterest Income
Level One's noninterest income increased
The increase in noninterest income year over year was primarily due to increases of
Noninterest Expense
Level One's noninterest expense remained flat at
The efficiency ratio, which is a measure of operating expenses as a percentage of net interest income and noninterest income, for the third quarter of 2020 was 58.81%, compared to 62.79% for the preceding quarter and 68.50% in the third quarter of 2019. The decrease in the efficiency ratio year over year was primarily driven by the
Income Tax Expense
Level One's income tax provision was
The investment securities portfolio grew
Loan Portfolio
Total loans were
Deposits
Total deposits were
Borrowings
Total debt outstanding was
Asset Quality
Nonaccrual loans were
Level One had no other real estate owned assets at
Performing troubled debt restructured loans, which are not reported as nonaccrual loans but rather as part of impaired loans, were
Net chargeoffs in the third quarter of 2020 were
Level One's provision for loan losses in the third quarter of 2020 was a provision expense of
The allowance for loan losses was
Capital
Total shareholders’ equity was
Recent Developments
Third Quarter Common Stock Dividend: On
Preferred Stock Public Offering and First Cash Dividend: On
On
Level One's Response to the COVID-19 Pandemic: Level One has taken comprehensive steps to help our customers, team members and communities during the current COVID-19 pandemic health crisis. For our customers, we have provided loan payment deferrals and offered fee waivers, among other actions. Through
We are continuing to enable the vast majority of our main office team members to work remotely each day. We have also taken significant actions to help ensure the safety of our team members whose roles require them to come into the office, which includes the development, implementation and communication of a comprehensive return to office plan. In addition, while our branches have reopened to serve our clients, we will continue to be diligent in our efforts to follow all CDC guidelines in order to ensure the health and safety of our clients and team members. We will continue to evaluate this fluid situation and take additional actions as necessary.
About
Forward-Looking Statements
This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect management’s current views of future events and operations. These forward-looking statements are based on the information currently available to the Company as of the date of this release. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "will," "propose," "may," "plan," "seek," "expect," "intend," "estimate," "anticipate," "believe," "continue" or similar technology. It is important to note that these forward-looking statements are not guarantees of future performance and involve risk and uncertainties, including, but not limited to, the effects of the COVID-19 pandemic, including its potential effects on the economic environment, our customers and our operations, as well as any changes to federal, state or local government laws, regulations or orders in connection with the pandemic, the ability of the Company to implement its strategy and expand its lending operations, changes in interest rates and other general economic, business and political conditions, including changes in the financial markets, changes in benchmark interest rates used to price loans and deposits including the expected elimination of LIBOR, as well as other risks described in the Company's filings with the
Summary Consolidated Financial Information | ||||||||||||||||||||
(Unaudited) | As of or for the three months ended, | |||||||||||||||||||
(Dollars in thousands, except per share data) | 2020 | 2020 | 2020 | 2019 | 2019 | |||||||||||||||
Earnings Summary | ||||||||||||||||||||
Interest income | $ | 20,245 | $ | 20,396 | $ | 19,817 | $ | 17,366 | $ | 17,983 | ||||||||||
Interest expense | 3,648 | 4,163 | 4,997 | 4,458 | 4,995 | |||||||||||||||
Net interest income | 16,597 | 16,233 | 14,820 | 12,908 | 12,988 | |||||||||||||||
Provision (benefit) for loan losses | 4,270 | 5,575 | 489 | 548 | (16 | ) | ||||||||||||||
Noninterest income | 9,125 | 7,789 | 4,690 | 4,590 | 3,858 | |||||||||||||||
Noninterest expense | 15,126 | 15,083 | 14,562 | 11,295 | 11,539 | |||||||||||||||
Income before income taxes | 6,326 | 3,364 | 4,459 | 5,655 | 5,323 | |||||||||||||||
Income tax provision | 1,117 | 643 | 349 | 975 | 914 | |||||||||||||||
Net income | $ | 5,209 | $ | 2,721 | $ | 4,110 | $ | 4,680 | $ | 4,409 | ||||||||||
Net income allocated to participating securities | 40 | 19 | 47 | 50 | 45 | |||||||||||||||
Net income attributable to common shareholders | $ | 5,169 | $ | 2,702 | $ | 4,063 | $ | 4,630 | $ | 4,364 | ||||||||||
Per Share Data | ||||||||||||||||||||
Basic earnings per common share | $ | 0.68 | $ | 0.35 | $ | 0.53 | $ | 0.60 | $ | 0.57 | ||||||||||
Diluted earnings per common share | 0.67 | 0.35 | 0.53 | 0.60 | 0.56 | |||||||||||||||
Diluted earnings per common share, excluding acquisition and due diligence fees (1) | 0.67 | 0.37 | 0.68 | 0.63 | 0.60 | |||||||||||||||
Book value per common share | 24.06 | 23.31 | 22.74 | 22.13 | 21.77 | |||||||||||||||
Tangible book value per common share (1) | 18.74 | 18.09 | 17.54 | 20.86 | 20.51 | |||||||||||||||
Preferred shares outstanding (in thousands) | 10 | — | — | — | — | |||||||||||||||
Common shares outstanding (in thousands) | 7,734 | 7,734 | 7,731 | 7,715 | 7,714 | |||||||||||||||
Average basic common shares (in thousands) | 7,675 | 7,676 | 7,637 | 7,632 | 7,721 | |||||||||||||||
Average diluted common shares (in thousands) | 7,712 | 7,721 | 7,738 | 7,747 | 7,752 | |||||||||||||||
Selected Period End Balances | ||||||||||||||||||||
Total assets | $ | 2,446,447 | $ | 2,541,696 | $ | 1,936,823 | $ | 1,584,899 | $ | 1,509,463 | ||||||||||
Securities available-for-sale | 253,527 | 217,172 | 230,671 | 180,905 | 205,242 | |||||||||||||||
Total loans | 1,843,888 | 1,815,353 | 1,466,407 | 1,227,609 | 1,168,923 | |||||||||||||||
Total deposits | 1,943,435 | 1,821,351 | 1,470,608 | 1,135,428 | 1,194,542 | |||||||||||||||
Total liabilities | 2,236,979 | 2,361,437 | 1,761,055 | 1,414,196 | 1,341,495 | |||||||||||||||
Total shareholders' equity | 209,468 | 180,259 | 175,768 | 170,703 | 167,968 | |||||||||||||||
Total common shareholders' equity | 186,098 | 180,259 | 175,768 | 170,703 | 167,968 | |||||||||||||||
Tangible common shareholders' equity (1) | 144,963 | 139,913 | 135,578 | 160,940 | 158,250 | |||||||||||||||
Performance and Capital Ratios | ||||||||||||||||||||
Return on average assets (annualized) | 0.83 | % | 0.46 | % | 0.87 | % | 1.23 | % | 1.16 | % | ||||||||||
Return on average equity (annualized) | 10.48 | 6.02 | 9.40 | 10.98 | 10.58 | |||||||||||||||
Net interest margin (fully taxable equivalent)(2) | 2.80 | 2.98 | 3.42 | 3.56 | 3.59 | |||||||||||||||
Efficiency ratio (noninterest expense/net interest income plus noninterest income) | 58.81 | 62.79 | 74.64 | 64.55 | 68.50 | |||||||||||||||
Dividend payout ratio | 7.41 | 14.22 | 7.52 | 6.60 | 7.03 | |||||||||||||||
Total shareholders' equity to total assets | 8.56 | 7.09 | 9.08 | 10.77 | 11.13 | |||||||||||||||
Tangible common equity to tangible assets (1) | 6.03 | 5.59 | 7.15 | 10.22 | 10.55 | |||||||||||||||
Common equity tier 1 to risk-weighted assets | 8.83 | 8.76 | 8.10 | 11.72 | 11.73 | |||||||||||||||
Tier 1 capital to risk-weighted assets | 10.31 | 8.76 | 8.10 | 11.72 | 11.73 | |||||||||||||||
Total capital to risk-weighted assets | 14.39 | 12.81 | 11.68 | 15.99 | 13.84 | |||||||||||||||
Tier 1 capital to average assets (leverage ratio) | 7.17 | 6.21 | 7.08 | 10.41 | 10.12 | |||||||||||||||
Asset Quality Ratios: | ||||||||||||||||||||
Net charge-offs to average loans | 0.02 | % | 0.34 | % | 0.05 | % | 0.06 | % | 0.01 | % | ||||||||||
Nonperforming assets as a percentage of total assets | 0.79 | 0.33 | 0.89 | 1.23 | 0.78 | |||||||||||||||
Nonaccrual loans as a percent of total loans | 1.04 | 0.46 | 1.04 | 1.51 | 0.98 | |||||||||||||||
Allowance for loan losses as a percentage of total loans | 1.15 | 0.94 | 0.89 | 1.03 | 1.05 | |||||||||||||||
Allowance for loan losses as a percentage of nonaccrual loans | 110.32 | 206.37 | 85.32 | 68.40 | 107.46 | |||||||||||||||
Allowance for loan losses as a percentage of nonaccrual loans, excluding allowance allocated to loans accounted for under ASC 310-30 | 105.46 | 195.04 | 80.34 | 64.29 | 100.52 |
(1) See section entitled "GAAP Reconciliation of Non-GAAP Financial Measures" below.
(2) Presented on a tax equivalent basis using a 21% tax rate.
GAAP Reconciliation of Non-GAAP Financial Measures
Some of the financial measures included in this report are not measures of financial condition or performance recognized by GAAP. These non-GAAP financial measures include tangible common shareholders' equity, tangible book value per common share and the ratio of tangible common equity to tangible assets, as well as net income and diluted earnings per common share excluding acquisition and due diligence fees. Our management uses these non-GAAP financial measures in its analysis of our performance, and we believe that providing this information to financial analysts and investors allows them to evaluate capital adequacy, as well as better understand and evaluate the Company’s core financial results for the periods in question.
The following presents these non-GAAP financial measures along with their most directly comparable financial measure calculated in accordance with GAAP:
Tangible Common Shareholders' Equity, Tangible Common Equity to Tangible Assets Ratio and Tangible Book Value Per Share | |||||||||||||||||||
As of | |||||||||||||||||||
(Dollars in thousands, except per share data) | 2020 | 2020 | 2020 | 2019 | 2019 | ||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||
Total shareholders' equity | $ | 209,468 | $ | 180,259 | $ | 175,768 | $ | 170,703 | $ | 167,968 | |||||||||
Less: | |||||||||||||||||||
Preferred stock | 23,370 | — | — | — | — | ||||||||||||||
Total common shareholders' equity | 186,098 | 180,259 | 175,768 | 170,703 | 167,968 | ||||||||||||||
Less: | |||||||||||||||||||
35,554 | 35,554 | 36,216 | 9,387 | 9,387 | |||||||||||||||
Other intangible assets, net | 5,581 | 4,792 | 3,974 | 376 | 331 | ||||||||||||||
Tangible common shareholders' equity | $ | 144,963 | $ | 139,913 | $ | 135,578 | $ | 160,940 | $ | 158,250 | |||||||||
Common shares outstanding (in thousands) | 7,734 | 7,734 | 7,731 | 7,715 | 7,714 | ||||||||||||||
Tangible book value per common share | $ | 18.74 | $ | 18.09 | $ | 17.54 | $ | 20.86 | $ | 20.51 | |||||||||
Total assets | $ | 2,446,447 | $ | 2,541,696 | $ | 1,936,823 | $ | 1,584,899 | $ | 1,509,463 | |||||||||
Less: | |||||||||||||||||||
35,554 | 35,554 | 36,216 | 9,387 | 9,387 | |||||||||||||||
Other intangible assets, net | 5,581 | 4,792 | 3,974 | 376 | 331 | ||||||||||||||
Tangible assets | $ | 2,405,312 | $ | 2,501,350 | $ | 1,896,633 | $ | 1,575,136 | $ | 1,499,745 | |||||||||
Tangible common equity to tangible assets | 6.03 | % | 5.59 | % | 7.15 | % | 10.22 | % | 10.55 | % | |||||||||
Adjusted Income and Diluted Earnings Per Share | |||||||||||||||||||
Three months ended | |||||||||||||||||||
(Dollars in thousands, except per share data) | 2020 | 2020 | 2020 | 2019 | 2019 | ||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||
Net income, as reported | $ | 5,209 | $ | 2,721 | $ | 4,110 | $ | 4,680 | $ | 4,409 | |||||||||
Acquisition and due diligence fees | 17 | 176 | 1,471 | 220 | 319 | ||||||||||||||
Income tax benefit (1) | (4 | ) | (34 | ) | (295 | ) | (26 | ) | (25 | ) | |||||||||
Net income, excluding acquisition and due diligence fees | $ | 5,222 | $ | 2,863 | $ | 5,286 | $ | 4,874 | $ | 4,703 | |||||||||
Diluted earnings per share, as reported | $ | 0.67 | $ | 0.35 | $ | 0.53 | $ | 0.60 | $ | 0.56 | |||||||||
Effect of acquisition and due diligence fees, net of income tax benefit | — | 0.02 | 0.15 | 0.03 | 0.04 | ||||||||||||||
Diluted earnings per common share, excluding acquisition and due diligence fees | $ | 0.67 | $ | 0.37 | $ | 0.68 | $ | 0.63 | $ | 0.60 | |||||||||
(1) Assumes income tax rate of 21% on deductible acquisition expenses. | |||||||||||||||||||
Allowance for Loan Loss as a Percentage of Total Loans, Excluding PPP Loans | |||||||||||||||||||
As of | |||||||||||||||||||
(Dollars in thousands, except per share data) | 2020 | 2020 | 2020 | 2019 | 2019 | ||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||
Total loans | $ | 1,843,888 | $ | 1,815,353 | $ | 1,466,407 | $ | 1,227,609 | $ | 1,168,923 | |||||||||
Less: | |||||||||||||||||||
PPP loans | 392,521 | 388,264 | — | — | — | ||||||||||||||
Total loans, excluding PPP loans | $ | 1,451,367 | $ | 1,427,089 | $ | 1,466,407 | $ | 1,227,609 | $ | 1,168,923 | |||||||||
Allowance for loan loss | $ | 21,254 | $ | 17,063 | $ | 12,989 | $ | 12,674 | $ | 12,307 | |||||||||
Allowance for loan loss as a percentage of total loans | 1.15 | % | 0.94 | % | 0.89 | % | 1.03 | % | 1.05 | % | |||||||||
Allowance for loan loss as a percentage of total loans, excluding PPP loans | 1.46 | % | 1.20 | % | 0.89 | % | 1.03 | % | 1.05 | % | |||||||||
Consolidated Balance Sheets | |||||||||||
(Unaudited) | As of | ||||||||||
(Dollars in thousands) | 2020 | 2020 | 2019 | ||||||||
Assets | |||||||||||
Cash and cash equivalents | $ | 176,486 | $ | 364,112 | $ | 49,361 | |||||
Securities available-for-sale | 253,527 | 217,172 | 205,242 | ||||||||
Other investments | 14,398 | 12,398 | 8,325 | ||||||||
Mortgage loans held for sale, at fair value | 60,635 | 24,557 | 26,864 | ||||||||
Loans: | |||||||||||
Originated loans | 1,603,893 | 1,558,955 | 1,093,694 | ||||||||
Acquired loans | 239,995 | 256,398 | 75,229 | ||||||||
Total loans | 1,843,888 | 1,815,353 | 1,168,923 | ||||||||
Less: Allowance for loan losses | (21,254 | ) | (17,063 | ) | (12,307 | ) | |||||
Net loans | 1,822,634 | 1,798,290 | 1,156,616 | ||||||||
Premises and equipment, net | 15,646 | 15,882 | 13,427 | ||||||||
35,554 | 35,554 | 9,387 | |||||||||
Other intangible assets, net | 5,581 | 4,792 | 331 | ||||||||
Other real estate owned | — | 61 | 373 | ||||||||
Bank-owned life insurance | 18,083 | 17,965 | 12,080 | ||||||||
Income tax benefit | 3,791 | 3,293 | 469 | ||||||||
Interest receivable and other assets | 40,112 | 47,620 | 26,988 | ||||||||
Total assets | $ | 2,446,447 | $ | 2,541,696 | $ | 1,509,463 | |||||
Liabilities | |||||||||||
Deposits: | |||||||||||
Noninterest-bearing demand deposits | $ | 632,427 | $ | 644,251 | $ | 322,069 | |||||
Interest-bearing demand deposits | 115,395 | 119,570 | 66,716 | ||||||||
Money market and savings deposits | 595,471 | 472,599 | 332,432 | ||||||||
Time deposits | 600,142 | 584,931 | 473,325 | ||||||||
Total deposits | 1,943,435 | 1,821,351 | 1,194,542 | ||||||||
Borrowings | 216,809 | 455,159 | 111,937 | ||||||||
Subordinated notes | 44,555 | 44,457 | 14,934 | ||||||||
Other liabilities | 32,180 | 40,470 | 20,082 | ||||||||
Total liabilities | 2,236,979 | 2,361,437 | 1,341,495 | ||||||||
Shareholders' equity | |||||||||||
Preferred stock, no par value per share; authorized-50,000 shares; issued and outstanding-10,000 shares at | 23,370 | — | — | ||||||||
Common stock, no par value per share; authorized - 20,000,000 shares; issued and outstanding - 7,734,322 shares at | 89,409 | 89,175 | 89,206 | ||||||||
Retained earnings | 88,646 | 83,824 | 73,394 | ||||||||
Accumulated other comprehensive income, net of tax | 8,043 | 7,260 | 5,368 | ||||||||
Total shareholders' equity | 209,468 | 180,259 | 167,968 | ||||||||
Total liabilities and shareholders' equity | $ | 2,446,447 | $ | 2,541,696 | $ | 1,509,463 | |||||
Consolidated Statements of Income | ||||||||||||||||
(Unaudited) | Three months ended | Nine months ended | ||||||||||||||
(In thousands, except per share data) | 2020 | 2020 | 2019 | 2020 | 2019 | |||||||||||
Interest income | ||||||||||||||||
Originated loans, including fees | $ | 15,274 | $ | 15,317 | $ | 14,633 | $ | 44,630 | $ | 42,652 | ||||||
Acquired loans, including fees | 3,456 | 3,642 | 1,501 | 11,187 | 4,895 | |||||||||||
Securities: | ||||||||||||||||
Taxable | 652 | 594 | 857 | 1,930 | 2,773 | |||||||||||
Tax-exempt | 613 | 670 | 588 | 1,894 | 1,728 | |||||||||||
Federal funds sold and other | 250 | 173 | 404 | 817 | 1,034 | |||||||||||
Total interest income | 20,245 | 20,396 | 17,983 | 60,458 | 53,082 | |||||||||||
Interest Expense | ||||||||||||||||
Deposits | 2,323 | 2,884 | 4,478 | 9,039 | 13,216 | |||||||||||
Borrowed funds | 693 | 643 | 261 | 1,866 | 960 | |||||||||||
Subordinated notes | 632 | 636 | 256 | 1,903 | 759 | |||||||||||
Total interest expense | 3,648 | 4,163 | 4,995 | 12,808 | 14,935 | |||||||||||
Net interest income | 16,597 | 16,233 | 12,988 | 47,650 | 38,147 | |||||||||||
Provision expense (benefit) for loan losses | 4,270 | 5,575 | (16 | ) | 10,334 | 835 | ||||||||||
Net interest income after provision for loan losses | 12,327 | 10,658 | 13,004 | 37,316 | 37,312 | |||||||||||
Noninterest income | ||||||||||||||||
Service charges on deposits | 616 | 548 | 627 | 1,798 | 1,914 | |||||||||||
Net gain on sales of securities | 434 | 899 | 151 | 1,862 | 151 | |||||||||||
Mortgage banking activities | 7,108 | 5,684 | 2,352 | 15,380 | 5,788 | |||||||||||
Other charges and fees | 967 | 658 | 728 | 2,564 | 1,768 | |||||||||||
Total noninterest income | 9,125 | 7,789 | 3,858 | 21,604 | 9,621 | |||||||||||
Noninterest expense | ||||||||||||||||
Salary and employee benefits | 9,862 | 9,598 | 7,536 | 28,090 | 21,642 | |||||||||||
Occupancy and equipment expense | 1,678 | 1,567 | 1,203 | 4,773 | 3,575 | |||||||||||
Professional service fees | 808 | 941 | 465 | 2,141 | 1,212 | |||||||||||
Acquisition and due diligence fees | 17 | 176 | 319 | 1664 | 319 | |||||||||||
Marketing expense | 257 | 230 | 379 | 709 | 843 | |||||||||||
Printing and supplies expense | 89 | 173 | 78 | 398 | 250 | |||||||||||
Data processing expense | 844 | 910 | 661 | 2,601 | 1,862 | |||||||||||
Core deposit premium amortization | 192 | 192 | 29 | 576 | 117 | |||||||||||
Other expense | 1,379 | 1,296 | 869 | 3,819 | 3,254 | |||||||||||
Total noninterest expense | 15,126 | 15,083 | 11,539 | 44,771 | 33,074 | |||||||||||
Income before income taxes | 6,326 | 3,364 | 5,323 | 14,149 | 13,859 | |||||||||||
Income tax provision | 1,117 | 643 | 914 | 2,109 | 2,428 | |||||||||||
Net income | $ | 5,209 | $ | 2,721 | $ | 4,409 | $ | 12,040 | $ | 11,431 | ||||||
Earnings per common share: | ||||||||||||||||
Basic earnings per common share | $ | 0.68 | $ | 0.35 | $ | 0.57 | $ | 1.56 | $ | 1.48 | ||||||
Diluted earnings per common share | $ | 0.67 | $ | 0.35 | $ | 0.56 | $ | 1.55 | $ | 1.46 | ||||||
Cash dividends declared per common share | $ | 0.05 | $ | 0.05 | $ | 0.04 | $ | 0.15 | $ | 0.12 | ||||||
Weighted average common shares outstanding—basic | 7,675 | 7,676 | 7,721 | 7,640 | 7,738 | |||||||||||
Weighted average common shares outstanding—diluted | 7,712 | 7,721 | 7,752 | 7,701 | 7,776 | |||||||||||
Net Interest Income and Net Interest Margin | |||||||||||||||||||||||||||||
(Unaudited) | For the three months ended | ||||||||||||||||||||||||||||
(Dollars in thousands) | Average Balance | Interest (1) | Average Rate (2) | Average Balance | Interest (1) | Average Rate (2) | Average Balance | Interest (1) | Average Rate (2) | ||||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||||||||||||
Gross loans (3) | $ | 1,871,164 | $ | 18,730 | 3.98 | % | $ | 1,756,234 | $ | 18,959 | 4.34 | % | $ | 1,182,764 | $ | 16,134 | 5.41 | % | |||||||||||
Investment securities: (4) | |||||||||||||||||||||||||||||
Taxable | 139,237 | 652 | 1.86 | 115,271 | 594 | 2.07 | 121,473 | 857 | 2.80 | ||||||||||||||||||||
Tax-exempt | 94,526 | 613 | 3.19 | 102,955 | 670 | 3.22 | 85,332 | 588 | 3.28 | ||||||||||||||||||||
Interest earning cash balances | 259,349 | 76 | 0.12 | 226,931 | 67 | 0.12 | 51,142 | 289 | 2.24 | ||||||||||||||||||||
Other investments | 12,419 | 174 | 5.57 | 12,398 | 106 | 3.44 | 8,325 | 115 | 5.48 | ||||||||||||||||||||
Total interest-earning assets | $ | 2,376,695 | $ | 20,245 | 3.41 | % | $ | 2,213,789 | $ | 20,396 | 3.73 | % | $ | 1,449,036 | $ | 17,983 | 4.96 | % | |||||||||||
Non-earning assets: | |||||||||||||||||||||||||||||
Cash and due from banks | $ | 27,571 | $ | 26,350 | $ | 23,103 | |||||||||||||||||||||||
Premises and equipment | 15,791 | 16,300 | 13,228 | ||||||||||||||||||||||||||
35,554 | 36,209 | 9,387 | |||||||||||||||||||||||||||
Other intangible assets, net | 4,980 | 4,297 | 347 | ||||||||||||||||||||||||||
Bank-owned life insurance | 18,006 | 17,888 | 12,023 | ||||||||||||||||||||||||||
Allowance for loan losses | (17,321 | ) | (13,081 | ) | (12,241 | ) | |||||||||||||||||||||||
Other non-earning assets | 55,899 | 52,153 | 27,145 | ||||||||||||||||||||||||||
Total assets | $ | 2,517,175 | $ | 2,353,905 | $ | 1,522,028 | |||||||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 116,285 | $ | 65 | 0.22 | % | $ | 115,176 | $ | 72 | 0.25 | % | $ | 51,963 | $ | 63 | 0.48 | % | |||||||||||
Money market and savings deposits | 513,420 | 556 | 0.43 | 457,576 | 561 | 0.49 | 320,363 | 1,170 | 1.45 | ||||||||||||||||||||
Time deposits | 575,179 | 1,702 | 1.18 | 570,052 | 2,251 | 1.59 | 543,765 | 3,245 | 2.37 | ||||||||||||||||||||
Borrowings | 394,020 | 693 | 0.70 | 352,554 | 643 | 0.73 | 70,766 | 261 | 1.46 | ||||||||||||||||||||
Subordinated notes | 44,468 | 632 | 5.65 | 44,456 | 636 | 5.75 | 14,925 | 256 | 6.81 | ||||||||||||||||||||
Total interest-bearing liabilities | $ | 1,643,372 | $ | 3,648 | 0.88 | % | $ | 1,539,814 | $ | 4,163 | 1.09 | % | $ | 1,001,782 | $ | 4,995 | 1.98 | % | |||||||||||
Noninterest-bearing liabilities and shareholders' equity: | |||||||||||||||||||||||||||||
Noninterest bearing demand deposits | $ | 640,095 | $ | 603,552 | $ | 333,690 | |||||||||||||||||||||||
Other liabilities | 34,846 | 29,750 | 19,804 | ||||||||||||||||||||||||||
Shareholders' equity | 198,862 | 180,789 | 166,752 | ||||||||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 2,517,175 | $ | 2,353,905 | $ | 1,522,028 | |||||||||||||||||||||||
Net interest income | $ | 16,597 | $ | 16,233 | $ | 12,988 | |||||||||||||||||||||||
Interest spread | 2.53 | % | 2.64 | % | 2.98 | % | |||||||||||||||||||||||
Net interest margin (5) | 2.78 | 2.95 | 3.56 | ||||||||||||||||||||||||||
Tax equivalent effect | 0.02 | 0.03 | 0.03 | ||||||||||||||||||||||||||
Net interest margin on a fully tax equivalent basis | 2.80 | % | 2.98 | % | 3.59 | % |
(1) Interest income is shown on actual basis and does not include taxable equivalent adjustments.
(2) Average rates and yields are presented on an annual basis and includes a taxable equivalent adjustment to interest income of
(3) Includes nonaccrual loans.
(4) For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.
(5) Net interest margin represents net interest income divided by average total interest-earning assets.
For the nine months ended | |||||||||||||||||||
(Dollars in thousands) | Average Balance | Interest (1) | Average Rate (2) | Average Balance | Interest (1) | Average Rate (2) | |||||||||||||
Interest-earning assets: | |||||||||||||||||||
Gross loans (3) | $ | 1,696,073 | $ | 55,817 | 4.40 | % | $ | 1,157,837 | $ | 47,547 | 5.49 | % | |||||||
Investment securities: (4) | |||||||||||||||||||
Taxable | 124,169 | 1,930 | 2.08 | 135,460 | 2,773 | 2.74 | |||||||||||||
Tax-exempt | 97,104 | 1,894 | 3.20 | 84,476 | 1,728 | 3.28 | |||||||||||||
Interest earning cash balances | 188,179 | 400 | 0.28 | 37,359 | 670 | 2.4 | |||||||||||||
Other investments | 12,401 | 417 | 4.49 | 8,325 | 364 | 5.85 | |||||||||||||
Total interest-earning assets | $ | 2,117,926 | $ | 60,458 | 3.84 | % | $ | 1,423,457 | $ | 53,082 | 5.02 | % | |||||||
Non-earning assets: | |||||||||||||||||||
Cash and due from banks | $ | 26,264 | $ | 24,075 | |||||||||||||||
Premises and equipment | 16,195 | 13,252 | |||||||||||||||||
35,894 | 9,387 | ||||||||||||||||||
Other intangible assets, net | 4,420 | 383 | |||||||||||||||||
Bank-owned life insurance | 17,868 | 11,955 | |||||||||||||||||
Allowance for loan losses | (14,387 | ) | (11,950 | ) | |||||||||||||||
Other non-earning assets | 47,714 | 18,642 | |||||||||||||||||
Total assets | $ | 2,251,894 | $ | 1,489,201 | |||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||
Deposits: | |||||||||||||||||||
Interest-bearing demand deposits | $ | 112,579 | $ | 262 | 0.31 | % | $ | 53,894 | $ | 180 | 0.45 | % | |||||||
Money market and savings deposits | 458,438 | 2,217 | 0.65 | 307,461 | 3,389 | 1.47 | |||||||||||||
Time deposits | 564,396 | 6,560 | 1.55 | 556,922 | 9,647 | 2.32 | |||||||||||||
Borrowings | 311,024 | 1,866 | 0.80 | 62,006 | 960 | 2.07 | |||||||||||||
Subordinated notes | 44,463 | 1,903 | 5.72 | 14,910 | 759 | 6.81 | |||||||||||||
Total interest-bearing liabilities | $ | 1,490,900 | $ | 12,808 | 1.15 | % | $ | 995,193 | $ | 14,935 | 2.01 | % | |||||||
Noninterest-bearing liabilities and shareholders' equity: | |||||||||||||||||||
Noninterest bearing demand deposits | $ | 546,066 | $ | 316,754 | |||||||||||||||
Other liabilities | 30,047 | 17,048 | |||||||||||||||||
Shareholders' equity | 184,881 | 160,206 | |||||||||||||||||
Total liabilities and shareholders' equity | $ | 2,251,894 | $ | 1,489,201 | |||||||||||||||
Net interest income | $ | 47,650 | $ | 38,147 | |||||||||||||||
Interest spread | 2.69 | % | 3.01 | % | |||||||||||||||
Net interest margin (5) | 3.01 | 3.58 | |||||||||||||||||
Tax equivalent effect | 0.03 | 0.03 | |||||||||||||||||
Net interest margin on a fully tax equivalent basis | 3.04 | % | 3.61 | % |
(1) Interest income is shown on actual basis and does not include taxable equivalent adjustments.
(2) Average rates and yields are presented on an annual basis and includes a taxable equivalent adjustment to interest income of
(3) Includes nonaccrual loans.
(4) For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.
(5) Net interest margin represents net interest income divided by average total interest-earning assets.
Loan Composition | ||||||||||||||
(Unaudited) | As of | |||||||||||||
(Dollars in thousands) | 2020 | 2020 | 2020 | 2019 | 2019 | |||||||||
Commercial real estate: | ||||||||||||||
Non-owner occupied | $ | 460,708 | $ | 451,906 | $ | 450,694 | $ | 388,515 | $ | 369,284 | ||||
Owner-occupied | 269,481 | 273,577 | 278,216 | 216,131 | 196,497 | |||||||||
Total commercial real estate | 730,189 | 725,483 | 728,910 | 604,646 | 565,781 | |||||||||
Commercial and industrial | 807,923 | 790,353 | 469,227 | 410,228 | 404,130 | |||||||||
Residential real estate | 304,088 | 294,041 | 262,894 | 211,839 | 198,277 | |||||||||
Consumer | 1,688 | 5,476 | 5,376 | 896 | 735 | |||||||||
Total loans | $ | 1,843,888 | $ | 1,815,353 | $ | 1,466,407 | $ | 1,227,609 | $ | 1,168,923 | ||||
Impaired Assets | ||||||||||||||
(Unaudited) | As of | |||||||||||||
(Dollars in thousands) | 2020 | 2020 | 2020 | 2019 | 2019 | |||||||||
Nonaccrual loans | ||||||||||||||
Commercial real estate | $ | 7,022 | $ | 3,649 | $ | 3,721 | $ | 4,832 | $ | 5,043 | ||||
Commercial and industrial | 8,078 | 2,377 | 9,364 | 11,112 | 4,071 | |||||||||
Residential real estate | 4,151 | 2,226 | 2,124 | 2,569 | 2,339 | |||||||||
Consumer | 15 | 16 | 15 | 16 | — | |||||||||
Total nonaccrual loans | 19,266 | 8,268 | 15,224 | 18,529 | 11,453 | |||||||||
Other real estate owned | — | 61 | 2,093 | 921 | 373 | |||||||||
Total nonperforming assets | 19,266 | 8,329 | 17,317 | 19,450 | 11,826 | |||||||||
Performing troubled debt restructurings | ||||||||||||||
Commercial and industrial | 550 | 549 | 541 | 547 | 553 | |||||||||
Residential real estate | 599 | 600 | 599 | 359 | 361 | |||||||||
Total performing troubled debt restructurings | 1,149 | 1,149 | 1,140 | 906 | 914 | |||||||||
Total impaired assets | $ | 20,415 | $ | 9,478 | $ | 18,457 | $ | 20,356 | $ | 12,740 | ||||
Loans 90 days or more past due and still accruing | $ | 552 | $ | 903 | $ | 437 | $ | 157 | $ | 157 |
Media Contact:Nicole Ransom (248) 538-2183 Investor Relations Contact:Peter Root (248) 538-2186
Source:
2020 GlobeNewswire, Inc., source